7/08/13 Crains New York

Bidders up ante at Empire State Bldg.

For 82 years, the Empire State Building has towered over New York and loomed large in the imaginations of locals and tourists alike. But not since King Kong clung to its radio mast in the 1933 movie has the spire seen a battle like this.

On the one side is Malkin Holdings, the company that controls the 102-story landmark, and which only recently won the backing of the vast majority of the building’s 2,800 shareholders to make it the centerpiece of a new $5 billion public company.

On the other side is a growing gaggle of some of the richest real estate moguls in the nation, all of whom insist that Malkin is undervaluing the building. In the past month, four of them have come forward with offers of their own. Most recently, it was the turn of Reuven Kahane, a real estate investor from the West Coast who first gained fame for introducing the American bagel to Israel. His $2.25 billion offer last week bested other recent bids by—in order of their appearance on the scene—Woolworth Building owner Rubin Schron; a group led by real estate investorsPhil Pilevsky and Joseph Tabak;and Joseph Sitt, chief of prolific real estate investment firm Thor Equities, who has offered $2.1 billion.

The bids have raised questions as to what the building is worth, and whether it is more valuable on the private or public market.Malkin,which by the end of the year wants to roll thebuilding and 18 other midtown properties into a new real estate investment trust to be called Empire State Realty Holdings, has advised shareholders that the property could beworth north of $2.7 billion in an IPO—far more than the private bids.—daniel geiger